Tendering for Government Contracts A Guide for Small Businesses Third Edition Tendering for Government Contracts A Guide for Small Businesses overlap in this area. We both let the small About this guide business community know where to find government opportunities, and make sure that small businesses receive equal treatment The public sector spends a huge amount each when competing for contracts. year and is always looking for new suppliers. However small your business, there are You can find the website addresses and always opportunities to supply this market. contact details for all the public-sector Even if you are already supplying one part of organisations we mention at the end of the public sector, it is worth looking for this guide. opportunities in other areas. If you work in a small business, this guide What is the public sector? aims to help you in three ways. Firstly, it will tell you about where to find opportunities within the public sector. Secondly, it will The public sector employs more than 25% of explain how you can bid for work. Thirdly, it the UK workforce and includes: will advise you on the further contacts you • central civil government departments may need to make. and agencies; The Small Business Service (SBS) and the • the NHS and its local trusts; Office of Government Commerce (OGC) have • the Ministry of Defence; produced this guide jointly. The SBS is an Executive Agency of the Department of Trade • the Northern Ireland Assembly, the and Industry, and was set up in April 2000 National Assembly for Wales and the with the aim of making the UK the best place Scottish Executive; in the world to set up and run a business. • local authorities; We are dedicated to helping small firms and • universities; and representing their interests. The OGC is an Office of HM Treasury, and was also set up • colleges. in April 2000 with the aim of improving the Government’s commercial performance. Whatever your business, there may be a One of OGC’s main objectives is to achieve market for it somewhere within the public effective competition for government business sector, whether by contracting directly or by by simplifying access to the government becoming a subcontractor. market place. The aims of SBS and OGC 1 What are the benefits to you? • responsiveness; • flexibility; Public-sector organisations are good • quality of service; and customers. They have to be fair, honest and • specialisation. professional in the way they choose suppliers and in any dealings with them. Most are also All of this can mean better value for money long-standing, stable customers, and have to for the public sector. pay promptly and in line with agreed contract terms. Public-sector organisations have to EC procurement directives pay accounts within 30 days (or any other agreed credit period) of receiving a valid bill An EC treaty covers all public-sector or invoice. You will find more information on procurement contracts within the European prompt payment law later in this guide. Community, no matter what their value. The treaty sets down principles to prevent You may also find that trading successfully discrimination against firms from any with the public sector can give added member state. The principles of the treaty credibility with private-sector customers. are backed up by a series of EC procurement directives. The directives have been included What are the benefits to the in UK law as a number of regulations. public sector? The directives and regulations set down procedures and standards (based on openness, non-discrimination and The Government is committed to helping competition) for choosing tenderers and small and medium-sized enterprises (SMEs) awarding contracts with an estimated value because it believes that helping more SMEs to above a set limit. You can find information compete gives better value for money for the about the EC procurement directives and public sector. Value for money is defined as regulations on the OGC website or from ‘the optimum combination of whole life costs your nearest Euro Information Centre. and quality to meet the user requirement’. Small firms can offer: The way in • greater competition; • lower costs; Where are opportunities advertised? • new ideas; Opportunities for contracting with the public You can find the contact details for all the organisations we mention at the back of this booklet. 2 Tendering for Government Contracts sector may be advertised in a wide variety your nearest centre to discuss the help and of places. Contracts below the EC limit advice offered on selling to the public sector. (around £99,000) are often advertised in Some centres offer direct access to public- trade journals, increasingly on websites, sector opportunities that are tailored to your and occasionally in national or regional business’s specific needs. newspapers. However, although encouraged to do so, some public-sector organisations do Similar services are offered through not advertise low-value contracts at all. You Business Gateway, and Highlands and may benefit from identifying the appropriate Islands Enterprise in Scotland, Business Eye individual in an organisation, through the in Wales and Invest Northern Ireland. contacts listed at the end of this guide, and giving them information about your business. Government Departments Government Departments and their agencies Supplying Government must follow the Official Journal of the Supplying Government is a website provided European Union (OJEU) procedures for tenders by OGC and Business Link that gives advice with an estimated value of around £99,000 to businesses on: or more. However, if you are looking for contracts below this value, or your product or • selling products and services to the service is particularly original, it may be more Government; appropriate for you to choose a department or • contact points in government a number of departments and contact them organisations; directly. You can find the initial contacts for Government Departments in the insert to this • where to find advertised contract guide. It is always worthwhile searching the opportunities; and internet as some departments have ‘selling to’ • contact details and links to equivalent pages on their websites. sites in Scotland, Wales and Northern Ireland. Government Opportunities Two useful publications are ‘Government Business Link Opportunities’ and ‘Contrax Weekly’ which Business Link provides access to a range of are published by the commercial company business advice and support for small firms in Business Information Publications (BiP). England. You can contact them by phone or on These are available monthly and weekly their website, and will be put in touch with respectively. You can find the contact details for all the organisations we mention at the back of this booklet. 3 Euro Info Centres limits, including a number of services that do Euro Info Centres (EIC) have been set up not need to be advertised. Some departments, throughout the UK by the European however, have made it their policy to advertise Commission to provide information and more widely in OJEU than they are obliged to. services for business. These include a full There are several ways of gaining access library service of OJEU and an Alerting Service to OJEU. for Tenders Electronic Daily (TED). Most centres have been set up in host organisations • Tenders Electronic Daily (TED) is the including, for example, business development online version of OJEU. It uses subject and agencies, such as Business Link, university country codes to give you direct access to libraries and regional Chambers of Commerce. notices that may interest you. However, many businesses find it easier to use Official Journal of the European Union the TED service offered by Business (OJEU – formerly called OJEC) Link, Euro Information Centres and commercial organisations like Almost all public procurement contracts for Government Opportunities. business worth more than an EC limit, which is roughly £99,000, must be published in the • Copies of OJEU (in CD-ROM format) are daily supplement to the Official Journal of available by paying a subscription or by the European Union (OJEU). This provides buying copies from The Stationery Office. information on the current requirements and • The Stationery Office also has a Scanfax invites suppliers to express an interest, or to Service that is one of a number of OJEU tender directly in some cases, depending scanning services that will fax specific on the contract procedure. It also sets out extracts from OJEU. information about contracts that have been awarded. • You can also see copies at some Euro Info Centres. The regulations that say precisely which contracts must appear in OJEU are very Selling to Europe detailed. However, you can get information If you want to sell to Europe, the first step about these from the OGC website. As a is to assess which markets are open to you general guide, tenders for more than £99,000 and whether or not you can meet their of goods and services or for more than needs. As well as looking in OJEU, UK Trade £3.8 million of works must appear in OJEU. & Investment has a wide range of market However, there are many exceptions to these information ranging from country profiles to You can find the contact details for all the organisations we mention at the back of this booklet. 4 Tendering for Government Contracts individual sector reports (for more details, see subcontractors or by forming consortia. their website or contact Business Link). There is no single way of finding out about subcontracting opportunities, although OGC is Small Business Research Initiative (SBRI) encouraging large suppliers to government to This initiative is designed to: make subcontracting opportunities available via their websites. Public-sector organisations • encourage and increase the demand for may give you information about their main research and development (R & D) from contractors or you might identify and contact small firms; and a supplier who has won a major contract, for • give small firms the opportunity to show example through OJEU.